Suzuki now shown to have used the “wrong tests to determine fuel efficiency” on their cars

Mitsubishi gets nailed for falsifying fuel efficiency tests on 625,000 of their automobiles, and now Suzuki gets exposed for similar fudging of fuel efficiency tests. Only Suzuki claims they used the “wrong fuel economy tests.” How does one of the most successful automobile manufacturers in the word notorious for extremely well built cars come up with using the “wrong tests to determine fuel efficiency” on their Suzuki cars? Now I am starting to wonder if these two Japanese car manufacturers, Mitsubishi and now Suzuki, aren’t caught up in something deeper going on here somehow related to the car tax increase and faked fuel efficiency tests? Is the increase in car tax on Kei-cars somehow related to the mileage these Kei-cars are getting? I don’t really know but certainly makes one think considering how secretive Japan’s bureaucracies are connected to Japan’s corporations. Both these “scandals” appeared when the 80 percent increase in Kei-car tax went into effect this past April.
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Source: Reuters

Suzuki says it used wrong fuel economy tests in Japan

By Minami Funakoshi

Suzuki Motor Chairman and Chief Executive Officer Osamu Suzuki bows at a news conference at the Land, Infrastructure, Transport and Tourism Ministry in Tokyo, Japan, May 18, 2016. Reuters/Thomas Peter

Suzuki Motor Corp (7269.T) used the wrong methods to test the fuel economy of its cars in Japan, it said on Wednesday, widening a testing scandal that has already rocked smaller rival Mitsubishi Motors Corp (7211.T).

Japan’s transport ministry ordered widespread checks to industry methods after Mitsubishi Motors admitted last month it manipulated fuel economy data for at least four mini-vehicle models, overstating their efficiency.

Mitsubishi Motors’ president, Tetsuro Aikawa, said on Wednesday he would step down over that scandal, becoming the first senior departure since it broke, battering the company’s reputation and wiping billions off its market value.

Worries over similar damage for Suzuki sent shares in Japan’s fourth-largest carmaker down as much as 15 percent during the day.

Suzuki said it would continue selling its mini-cars and saw no impact on its earnings. The correct readings, it said, were not significantly different to those it submitted.

Japanese authorities, however, have asked for further details from Suzuki before May 31, calling its use of non-compliant tests “outrageous”.

“The company apologizes for the fact that we did not follow rules set by the country,” CEO Osamu Suzuki told reporters, adding 2.1 million vehicles were affected.

The company denied using the tests to make its fuel economy data look better. It blamed the decision to cobble together readings from individual car parts – rather than a single reading – on its windy testing location on a coastal hill that made readings erratic. The individual parts were tested indoors, it said.

Suzuki specializes in mini-vehicles, which have engines of up to 660cc and get preferential tax treatment under Japanese law. It has roughly a third of the country’s mini-vehicle market. It also has a successful Indian subsidiary, Maruti Suzuki (MRTI.NS).

MITSUBISHI’S WOES

The transport ministry, which had asked all automakers operating in Japan to re-submit fuel economy readings on all models by Wednesday, said no other carmakers had manipulated data or used improper tests.

It is still awaiting further detail, however, from Suzuki. It said it has yet to decide whether to penalize Mitsubishi Motors and, if so, by how much.

Mitsubishi Motors’ admission that it cheated on the fuel economy tests is its third major scandal in under two decades, and has prompted the automaker to agree to sell a one-third controlling stake to Nissan Motor Co (7201.T).

At a press conference on Wednesday, Mitsubishi Motors blamed excessive pressure, less time spent on research and development and high expectations for fuel efficiency.

“There was no direct order from top management,” CEO Osamu Masuko said. “But top management did not have a firm grasp on the proceedings at the R&D department.” He said there were several chances for the company to stop its workers – but it did not.

Masuko, who has been at the helm of Mitsubishi Motors since 2005, has been named by Nissan boss Carlos Ghosn as Mitsubishi Motors’ “pilot”.

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